Long-term unemployment can actually impact wage inflation, contrary to previous beliefs. When the Phillips curve is not assumed to be linear, it is found that long-term unemployment has a significant negative effect on wage inflation. This means that during a recession, the long-term unemployed can still influence wage dynamics, even if the economy appears to be in a flat region of the Phillips curve. Linear models that do not consider this convexity in the Phillips curve may underestimate the importance of long-term unemployment in affecting wages.